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Defining a New Money Offer as ICBC Awarded Legal Costs


This ICBC offer to settle case review focuses on the definition of the term “new money” when contained in a written settlement offer. ICBC offered to settle this personal injury claim for $105,000 new money plus costs but the claimant rejected the offer making a counter-offer of $450,000.00. The judge ultimately awarded $87,250, comprised of $80,000 for pain and suffering, an in-trust, housekeeping and childcare capacity award of $5,000 and $2,550 for out of pocket expenses.
The Defendants  and ICBC were awarded their legal costs after the delivery of the first offer, made approximately 6 weeks before the trial, pursuant to Rule 14-1 and Rule 9-1 of the Supreme Court Civil Rules (Gill v. McChesney,2018 BCSC 1378)

 The claimant argued that the offers were unclear in that they: Sought to settle the tort claim, that is the third party liability claim, along with the Part 7 claim against the Insurance Corporation of British Columbia (ICBC); Used the phrase in the offer,  “after taking into account Part 7 benefits paid or payable”; and (c) Did not include a copy of a release.

The judge did not accept any of these arguments. Both settlement offers in this claim were expressed as “new money” offers so they were as clear as day. Furthermore, there is nothing at law precluding an offer to settle relating to both the tort and the ICBC injury claim. The inclusion of ICBC in the release did not make the offers ambiguous.

Reference in settlement offers to a release of ICBC did not in this case create confusion or ambiguity since it was common sense that past and future ICBC Part 7 claims were being released. One would expect this to be contextual given that most members of the public would not understand the difference between a new money offer to settle and an old money offer of settlement.

New Money as a legal term has not been formally defined in any legislation. The term “new money” usually means “in addition to the $money advanced on the tort claim and for ICBC Part 7 benefits” when used for an ICBC car accident case (see Startup v. Blake and MacIsaac & Co.,2001 BCSC 8 at para 45).

Settlement terms drafted to include a new money offer would therefore be an offer after deducting relevant past payments.  Personal injury offers use esoteric language such as “new money” and “old money” that change with the common law. Understanding the past payments to be deducted can also be critical to the outcome of the case.

Posted by Personal Injury Lawyer Mr. Renn A. Holness, B.A. LL.B.

Tags: ICBC settlement offers, New Money, Rule 9-1 Offers to Settle, settlement offer

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